Bahrain's western-backed security forces used "excessive force" and torture during the crackdown on the Pearl revolution this year, according to an official report [PDF] published as new protests erupted.

King Hamad Al Khalifa welcomed the report by the Bahrain Independent Commission of Inquiry and pledged reforms. However, he ignored its finding that Iran was not involved in unrest in the Gulf island state, and blamed Tehran's "propaganda" for fuelling sectarian strife.

The 500-page document detailed the use by Bahrain's information ministry and the National Security Agency of "a systematic practice of physical and psychological mistreatment, which in many cases amounted to torture".

The Gulf island state's government pledged there would be no immunity for anyone suspected of abuses. "All those who have broken the law or ignored lawful orders and instructions will be held accountable," a statement said.

Tension mounted in the hours before publication of the report, and police fired teargas to disperse protesters, with one man killed in unclear circumstances. A photojournalist was briefly detained.

Clashes broke out in Aali, south of Manama, the capital, after a 44-year-old man died when his car crashed into a house. Demonstrators said he had swerved to avoid security vehicles.

Political skirmishing has been going on for weeks, with the outcome of the inquiry criticised in advance as a "whitewash" by pro-democracy forces and hailed as a triumph of openness and accountability by the western-backed monarchy.

The inquiry was appointed by King Hamad but is headed by a respected international lawyer who has worked for the UN. The five-member team was asked to investigate whether the events of last February and March – in which up to 40 people were killed – "involved violations of international human rights law and norms".

Opposition activists have no doubt they did, and the government pre-empted publication by admitting on Monday that "excessive force" was used in crushing protests. But it also claimed that abuses were not government policy, and shifted the blame on 20 individual officers who are being prosecuted.

Al-Wifaq, Bahrain's main Shia political group, rejected the move, saying. "The ultimate responsibility lies with the top decisions makers rather than junior officials and soldiers."

The commission chairman, the American-Egyptian judge and academic Cherif Bassiouni, attracted controversy by backtracking from his initial finding that there was "no evidence of routine torture".

The government has described the commission as part of ongoing attempts to promote national reconciliation by reform and dialogue. Expensive foreign PR advisers have been hired to map out a media strategy to promote the report.

It said in a statement after publication: "It is our will and sincere hope that we are now moving into a period of renaissance and progress which will improve the lives of all citizens of the Kingdom of Bahrain."

But Alaa Shehabi, whose husband, Ghazi Farhan, is one of 500 people imprisoned since February, said: "If the government thinks a fancy party, and a glossy report will end the uprising, they are sadly mistaken. The struggle for democracy will continue."

Bahrain's place in the Arab spring is rooted in its political and economic circumstances – a minority Sunni dynasty ruling over a restive Shia majority in a tiny country at the heart of a volatile region dominated by Saudi Arabia and Iran. Initially peaceful protests were inspired by the revolutions in Egypt and Tunisia but triggered a violent backlash whose consequences still reverberate.

Pro-reform demonstrations at Pearl roundabout were followed by marches that paralysed Manama's financial district and headed for the royal palaces.

The drama peaked in mid-March when Saudi forces moved across the King Fahd causeway in a show of force that underlined Bahrain's particular fragility.

Shia demanding equal rights are portrayed by Sunnis as fanatics who are cheered on by Iran. The communities are polarised and their narratives, like in Northern Ireland and Israel/Palestine, are hard to reconcile. Both see themselves as victims – though the suffering has been one-sided: most of the dead, and the hundreds injured and imprisoned, are Shia; 30 Shia mosques, allegedly built without licences, have been demolished.

The wider political implications of the report could be significant. The US, whose Fifth Fleet is based in Manama, had said it would delay a $53m arms sale to Bahrain until publication of the report.